It started simply enough. The first time Ken drove his dad to the doctor’s office, it was a piece of cake, hardly worth a thought. After all, Ken had just retired and could easily fit the appointment into his schedule. These days, less than two years later, it is hard for Ken to have a thought for very long about anything other than his father’s care.

Ken’s retirement was not supposed to be like this. It was supposed to be filled with fun things like traveling with his wife, playing with his grandchildren and golfing with his buddies. Ken did manage to squeeze in a couple of hiking trips that first year of retirement but being away for any length of time worries him.  “What if Dad needs me? I need to be able to get to him,” Ken told me.

Ken is far from unusual. Many retirees and those approaching retirement are finding themselves devoting more and more time, attention and money to caregiving. People are living longer, but they are not necessarily living as independently.

Eyesight weakens. Reflexes slow. With so many whackos on the road, driving can quickly become very dangerous as we age. Balance is harder to maintain. It gets challenging to navigate stairs or uneven surfaces.

Then there is the threat of cognitive decline. Is there a 60-year-old in America who isn’t close to a family caring for someone with Alzheimer’s or dementia?

At the 2015 Financial Advisor Inside Retirement conference, Greg Sullivan and I took turns talking about several non-investment related ways clients fail to have the retirement they want. Evan Simonoff, editor-in-chief of Financial Advisor, moderated the panel and used it as the basis for the cover story of the June 2015 issue, “Why Clients Fail at Retirement.”

In that article, Simonoff touched on some of the challenges that arise to derail a well-conceived retirement such as divorce, second homes, starting businesses, fraud, supporting adult children, healthcare expenses and overspending. After seeing it come up again a couple of times recently, I’d add caregiving to our list.

Taking someone to the doctor is not a big deal; Ken was happy to do it. However, as the frequency of the visits increased, the inclination to say it was not a burden waned.

It wasn’t just the number of visits to his dad’s house or taking his dad to doctor appointments that never seem to go off as scheduled. As Ken’s dad’s health continued to decline, Ken was faced with the realization that the task was becoming too much for him. He lacked the skill necessary to care for his dad. He was tired. He couldn’t turn his attention to other important matters. He was starting to resent his siblings who were not helping. His wife felt neglected.

This recognition led him to seek help and into the confusing world of elder care. Medicare, Medicaid, the VA and many programs available through state government are complex. Health and long-term-care insurance policies are also far from simple.

A new caregiver can easily be overwhelmed by a deluge of unfamiliar terms that may or may not have any applicability to a particular person’s situation. Most people are not familiar with the meaning of and differences between “assisted living”, “continuing care”, “skilled care”, “nursing care”, “respite care”, “home health care”, “palliative care” or a host of other terms until they are in a caregiving situation and need to learn—fast.

The care recipient often doesn’t have a handle on all these things either. While technology can help, it can also complicate matters. Some bills, notices and correspondence comes electronically, others by mail. “What did dad do with his checkbook?” 

All of this adds to the caregiver’s stress levels, and the higher stress can make a difference.

A recent study by Genworth, Beyond Dollars 2015, revealed some significant statistics.   

Stress on caregivers can affect their health and well-being. Fifty-five percent of caregivers did not feel qualified to provide physical care. Nearly 33 percent of caregivers reported an extremely high level of stress. Forty-three percent of caregivers said the LTC event negatively affected their personal health and well-being. Forty-four percent of caregivers experienced negative feelings such as depression.

Ken’s issues with his siblings are not unusual. Thirty-five percent of caregivers said the experience negatively affects their relationships with other family members or spouses.

Sixty-two percent of caregivers also reported spending some of their own funds for items related to caregiving. Many caregivers are often faced with cutting back on personal expenses like vacations or reducing savings which adds to the stress. Forty-five percent said they reduced their base standard of living and 38 percent reduced savings or retirement contributions. 

Ken started his caregiving as he retired, but many caregivers are still working. Looking after someone can easily become a second job. About a third of respondents in the Genworth survey reported spending 30 hours or more per week on care-related activities. With all the time and attention needed for caregiving, it is little wonder that many reported adverse consequences for their careers. 

Seventy-seven percent of caregivers reported missing some time at work. Fifty-two percent had to reduce their hours (seven hours a week on average). Forty-one percent lost vacation or sick time. Twenty-six percent reported missing career opportunities and 11 percent lost their jobs entirely.

Some of the stress of caregiving can be relieved. Most often relief comes through some combination of additional caregivers, additional funding sources and respite care for the caregivers. All of these are acquired more easily, efficiently and effectively through planning.

Fifty-nine percent of recipients would have done things differently. The most common reasons for not formulating a plan early in the process were caregivers who didn’t want to admit care was needed or to talk about it, thought they had more time, hoped the issue would resolve itself or were caught off guard because the timing of the need for care was unexpected.

The unexpected and the unknown are two common sources of stress. As financial planners, we can’t protect people entirely from uncertainty, but we can help them be realistic about aspects of their future.

Planners can help clients consider where and how care can be given, who in the family needs to be involved and how, how to pay for care and what other professionals should be utilized. We can also help clients get over the denial factor and encourage them to have the conversations they need to have with the care recipient and anyone else who cares about them. 

My parents are of that age where their care is something that warrants some planning. They live independently and probably will continue to do so for a long time, but they will need some help from me. Because I have seen the need for care unfold so many times for clients, the role of caregiver is not one I fear.

With some effort and a lot of encouragement, you can help your clients reduce the fear as well. You can help them initiate the needed conversations, get the right information, connect with the right people and have a much less stressful experience as a caregiver.  

That is not just better for them, it is better for the care recipient too. Giving them good care is the goal, after all.

 

Dan Moisand, CFP, has been featured as one of America’s top independent financial advisors by Financial Planning, Financial Advisor, Investment Advisor, Investment News, Journal of Financial Planning, Accounting Today, Research, Wealth Manager and Worth magazines. He practices in Melbourne, Fla.  You can reach him at [email protected].